Talent2 half-year result ‘disappointing’: CEO

Recruitment specialist
Talent2 International
chief executive
John Rawlinson
expects the job market to remain tough for at least the next six months.

Talent2 posted a 59 per cent drop in earnings before interest, tax, depreciation and amortisation for the six months to December.

Mr Rawlinson said the message across its diverse client base worldwide was the job market would be affected by the pace of economic recovery in the United States and Europe. “What’s coming from our clients, given the global economy, is ‘assume it remains challenging for the first half’," he said. “The second half of this calendar year, we might see some improvement."

But Mr Rawlinson said Talent2 had rebranded and hired key personnel to enhance the group’s service delivery. “It has been a sluggish six months but we’ve contributed [to the business] by investing," he said. “We didn’t cut costs hard because we believe the investment is going to pay off in the longer term."

Talent2 invested $4.2 million to fund a major payroll project in the half. The group’s net debt position also rose from $4.2 million to $25.9 million as a result of the Origin HR acquisition and buying a non-controlling stake in the group’s recruitment operations in Japan.

As forecast, Talent2 increased its revenue by 7 per cent to $158.2 million. EBITDA fell 59.3 per cent to $5.3 million. Goldman Sachs said reported EBITDA was slightly below its forecast of $5.5 million.

Mr Rawlinson said the group was disappointed with the result.

“The deferral of hiring decisions by clients in the last month of the period resulted in the company reporting at the lower end of the guidance given in December," he said.